• Sat. May 21st, 2022

African bitcoin outpost raises many red flags

ByHazel R. Lang

May 3, 2022

LONDON (Reuters’ Breaking News) – Bitcoin’s latest fans are a far cry from Silicon Valley’s Crypto Brothers. The war-torn Central African Republic (CAR) on Wednesday accepted digital currency as legal tender. It’s stranger than what El Salvador did last year. The surprise expressed by the region’s central bank and President Faustin-Archange Touadra’s military bias against Russian mercenaries are warning signs. Bitcoin’s path to mainstream currency is now rocky. El Salvador’s conversion to cryptocurrencies in September grabbed headlines and drew many sighs from the International Monetary Fund. Within months, nearly 4 million people, or two-thirds of the population, have invested in the new Chivo e-wallet system in Central America. However, all but a few were happy with the conversion of the US dollar to digital rather than bitcoin. Six months later, according to the Chamber of Commerce of El Salvador, only 14% of Salvadoran merchants had a crypto transaction. Crypto’s case in CAR seems even weaker. Most of the 5 million citizens of the former French colony enjoy a GDP per capita of just $525, without access to broadband or 4G phone reception, a prerequisite for bitcoin-based transactions. Unlike El Salvador, a third of the population works in the United States, and some Central African immigrants abroad are willing to send money home. In addition, residents of Bangui, its river capital, already have access to digital currency through mobile payment networks operated by operators such as France’s Orange. Also, unlike many very poor countries, they have a fixed currency through the six-nation CFA franc, which is pegged to the euro, backed by the Banque de France and overseen by the regional bank for Central African countries. . (BEAC) in neighboring Cameroon. Turning this system against the wild swings of bitcoin does not apply to Tutra’s vision of a new era of cryptocurrency-driven peace and prosperity. BEAC’s surprise at Bangui’s bet on Bitcoin raises serious eyebrows. A number of Russian mercenaries have been indicted by the UN since 2018. https://www.bbc.com/news/world-africa-59699350 Atrocities including torture, rape and brief executions. With the American and European sanctions imposed after the occupation of Ukraine by Russia, it will be difficult to pay their employer, the Wagner group. Bitcoin – along with CAR’s gold and diamond reserves – can provide another means of payment. If so, the tar will be done by the cryptocurrency association.

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– The Central African Republic (CAR) announced on April 27 that it had adopted Bitcoin as legal tender. The country follows in the footsteps of El Salvador which converted the crypto unit into official currency in 2021.

– The CAR is one of six countries that use the Central African CFA franc, which is a regional currency administered by the Bank of Central African States (BEAC) based in neighboring Cameroon.

– A BEAC spokesperson said the company was only aware of CAR’s acceptance of bitcoin by the general public at the same time. Reuters reports that two former Central African prime ministers signed a letter describing the unilateral decision as a “serious breach”.

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